X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
When FBI agents entered the Holy Land Foundation for Relief and Development’s headquarters in Richardson, Texas, in December 2001, they literally packed up everything — computers, desks, plants, even the personal photographs of family members of the Muslim charity’s 50 employees. “The government is very careful to call this a freeze instead of a seizure,” says Albuquerque, N.M., lawyer Nancy Hollander, who represents the charity. “But that’s a distinction, not a difference. It doesn’t seem a whole lot different to the people from whom they took everything.” Hollander and her partners at Freedman Boyd Daniels Hollander Goldberg & Cline have been representing HLF in its battle with the federal government, which has left most of the charity’s staff unemployed, uncovered by health insurance and without access to their 401(k) accounts. “They are struggling,” Hollander says. Since the Bush administration alleged 10 months ago that the charity is a terrorist organization, its troubles have mounted — as have the subsequent payment problems for lawyers representing HLF employees, including Evans, Gandy, Daniel & Moore partner Tim Evans of Fort Worth, Texas, and Richard Anderson of Burleson, Pate & Gibson in Dallas. HLF’s fight with the federal government began on Dec. 4, 2001, when, shortly after FBI agents raided its headquarters, President George W. Bush proclaimed in the Rose Garden that “Hamas has obtained much of the money that it pays for murder abroad from right in the United States, money originally by the Holy Land Foundation.” In subsequent court filings, the federal government alleged that HLF is a “specially designated terrorist” and a “specially designated global terrorist” organization. Under guidelines set forth in the International Emergency Economic Powers Act and the Executive Orders of the President, the government maintains it has the right to block the assets of organizations “designated” as terrorists such as the HLF. The Office of Foreign Assets Control (OFAC) — the arm of the U.S. Department of the Treasury that administers and enforces economic and trade sanctions against alleged terrorists based on U.S. foreign policy and national security goals — now controls the HLF assets seized in the raid. In August, U.S. District Judge Gladys Kessler of the District of Columbia denied the HLF’s request to force the government to return its assets. In the 58-page ruling in Holy Land Foundation for Relief and Development v. John Ashcroft, et al., Kessler wrote that the government’s designation of the HLF as a terrorist organization probably was accurate, and she denied the HLF’s motion seeking a temporary injunction to return the charity’s assets. HLF had alleged that the government, by freezing the HLF’s assets, violated its First Amendment right to free speech and Fifth Amendment right to due process. In court filings and in the press, HLF maintains that it provides aid to the Palestinian population in the West Bank and Gaza. According to Kessler’s opinion, in HLF’s internal documents the group specifically seeks support for family members of “martyrs.” In its complaint against U.S. Attorney General John Ashcroft and other administration officials, HLF argued that the federal government misinterpreted HLF’s use of the term “martyr” (“shaheed” in Arabic) to mean the survivors of terrorists or suicide bombers. The HLF leaders contend they have used the term to mean anyone who has died an innocent death. The judge dismissed the HLF’s explanation as “not credible.” Significantly, however, Kessler allowed the HLF to continue to pursue a dismissal of the government’s claims on the basis of the charity’s allegations that its employees’ Fourth Amendment rights possibly were violated. The Fourth Amendment protects against unreasonable searches and seizures. “The government’s entry into HLF’s offices, search of its property and seizure of its office equipment without a warrant do raise significant Fourth Amendment concerns,” wrote Kessler. NO EASY RIDE In July, OFAC officials offered to release 401(k) assets to HLF employees. But OFAC will not release HLF funds to pay the attorney, Chicago’s James R. Fennerty of the James R. Fennerty Law Office, whom HLF employees hired to represent them in their effort to have the retirement accounts unfrozen, says Fennerty’s associate, Jeff Naffziger. Similarly, Evans and Anderson learned this summer that OFAC will not release HLF assets to compensate the two lawyers for their work in representing HLF leader Shukri Abu Baker, Hollander and Evans say. “We thought these guys were gonna get paid and then they weren’t,” Hollander says. Anderson declines to detail what happened but says he doesn’t deny Hollander’s characterization of what happened. Anderson says he no longer represents Abu Baker. Evans, on the other hand, concedes he worked “many, many hours” on matters for Abu Baker. Even though he now realizes that he performed the service gratis, Evans will continue to represent the HLF leader if the need arises. Asked how many hours specifically he spent on Baker’s matters, Evans says, “I didn’t see any reason to spend the time doing the math since I wasn’t getting paid anyway.” Evans believes a nonlawyer at OFAC made the decision to deny coverage for his fees, and he believes the agency’s actions raise significant legal questions: “When the same organization that seizes the assets gets to pick and choose whether they get representation to complain about it, something is wrong,” Evans says. OFAC officials also have offered to permit HLF employees to retrieve their personal effects from the government’s warehouse. Before releasing the photos and plants, however, OFAC officials requested that HLF employees identify precisely where the items they seek were located in the office on the day of the raid and that they sign a declaration that the property belongs to them and not the charity, Fennerty says. “The bottom line is they have no rules,” Hollander says, referring to OFAC officials. “They do what they want when they want.” U.S. Department of the Treasury spokeswoman Tasia Scolinos denies that characterization. “OFAC has responded quickly to legitimate license requests for attorney fees and other relief. � OFAC has established regulations that address most of the issues,” Scolinos says. The Treasury spokeswoman notes that HLF lawyers always have the option of pursuing any payment issues administratively. With the Blocking Order from the Executive Offices and the OFAC regulations, Scolinos says, a detailed road map exists for what kind of relief HLF is allowed. Anytime the HLF lawyers have questions, she says, OFAC officials will oblige and respond. It’s not as if Hollander and her partners expected an easy ride when they agreed to represent the HLF. Hollander recalls that when HLF leaders first contacted John Boyd, her partner sent her the usual conflict-check request. But then Hollander says he e-mailed the conflict-check request a second time, just to be sure. Other firms in Dallas, including Akin, Gump, Strauss, Hauer & Feld, which previously had represented HLF, declined to defend the charity once the president tagged HLF as allegedly aiding terrorists. Dallas lawyer Karen Pennington, who was going to represent individual employees until she identified a conflict, says she had no luck finding other Texas employment lawyers willing to help HLF workers fight for their 401(k) funds. “I tried talking to people here, but none of the employment lawyers were interested,” Pennington says. Before they formally agreed to represent the HLF, Hollander says, she and her partners checked with OFAC to be sure the agency would release HLF funds to cover attorney fees. “We didn’t agree to accept the representation until there was the idea that we were getting paid,” Hollander says. Since then, Hollander alleges OFAC has caused a number of headaches for the HLF lawyers. The federal agency has released funds to cover their attorney fees, but they did so slowly, she says, and she and her partners have been required to fill out a lot of paperwork and place many nagging phone calls to the agency and the bank to get the money. Hollander declines to specify how much HLF has paid the firm already through OFAC-controlled funds. Obtaining documents to build their case also has been hampered and made more expensive by OFAC practices, Hollander alleges. In one case, she and Boyd flew to Dallas and spent several days in an uncomfortable and particularly cold government warehouse where the HLF documents were stored, she says. They marked boxes so they could retrieve and copy them later, but by the time they were ready to make the copies, the government had moved the HLF property to another warehouse, and all their sorting and marking had been lost, she says. “Our whole trip had been wasted,” Hollander says. “It drives me crazy.” Charles Blau, a partner in Dallas’ Meadows, Owens, Collier, Reed, Cousins & Blau, is not surprised. He has represented other clients who’ve had assets frozen and held by OFAC and believes that the HLF lawyers can expect an even rougher time, especially in light of the nation’s current mood toward organizations designated as having alleged terrorist ties. (His own firm declined to represent the HLF when they were approached last December, Blau says.) “Times are different now,” he says. “We’ve never been in a situation quite like this.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

 
 

ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.